- Celestica has benefited from the AI boom, but the stock is now priced like a hot data center tech company, raising sustainability concerns.
- The company projects limited growth in 2025, with revenue expected to grow only 8%, indicating the AI-driven surge may not continue.
- The business has seen elevated margins from the AI boom, unlikely sustainable.
- Investors should be cautious with the stock trading at a high valuation of 21x 2025 EPS targets.
- I am Mark Holder (aka Stone Fox Capital), a CPA with degrees in Accounting and Finance. I lead the investing group Outfox The Street, where I attempt to uncover potential multibaggers while managing portfolio risk via diversification.
One way to play the hot AI market is equipment companies in the way of the picks and shovels in the gold rush. Celestica Inc. (NYSE:CLS) (TSX:CLS:CA) has greatly benefited from data center equipment demand. Stone Fox Capital (aka Mark Holder) is a CPA with degrees in Accounting and Finance. He is also Series 65 licensed and has 30 years of investing experience, including 10 years as a portfolio manager. Mark leads the investing group Outfox the Street where he shares stock picks and deep research to help readers uncover potential multibaggers while managing portfolio risk via diversification. Features include various model portfolios, stock picks with identifiable catalysts, daily updates, real-time alerts, and access to community chat and direct chat with Mark for questions.
